Competitive bidding is one method of determining the least cost for performing work defined by the construction documents. The bid states the price that the bidder will contract for to perform the work based on the work shown and described in the bidding documents. Bids are prepared in confidence by each bidder. They are usually sealed when submitted to the client (or, in the case of subcontractors, to the bidding contractors). At a specified time and date, all bids are opened, competitively examined, and compared. Unless there are compelling reasons to do otherwise, the client (contractor in the case of subcontractors) usually enters into an agreement to have the work performed by the bidder submitting the lowest price.
Before bids may be received, prospective bidders need to be identified and made aware of the project. Sufficient data should be furnished to potential bidders to allow preparation of their bids. The client may or may not wish to prequalify bidders. In those cases where prequalification is required, the architect can have meaningful input in the process based on past experience with potential bidders.
The terms bid and proposal are synonymous. Although proposal may imply an opportunity for more consideration and discussion with the client, architect, or engineer, bid, bidder, and bid form are preferable, to prevent misunderstanding by the bidders.
After client approval of the construction documents and selection of a construction bidding method, the architect may assist in the selection of contractors to bid the work; preparation of bid forms; issuance of bidding documents for competitive bidding; answering inquiries from bidders; and preparing and issuing any necessary addenda to the bidding documents. Furthermore, the architect may assist in analyzing bid proposals and making recommendations to the client as to the award of the construction contract. The architect can also assist in preparation of the construction contract.
Bidders may elect to change their bid on the basis of certain conditions, such as errors in the bid, changes in product cost, changes in labor rates, or nonavailability of labor because of other work or strikes. Each bidder is responsible for providing for any eventuality during the period the bid is open for acceptance.
Unless provided for otherwise, bidders may withdraw their bid before acceptance by the client, unless the client consents to a later withdrawal. If all conditions of the instructions to bidders have been met, then after the bids have been opened, the bids should be evaluated. The low bid especially should be analyzed to ensure that it reflects accurately the cost of the work required by the contract documents.
The bids may be compared with the architects construction cost estimate that was prepared on completion of the contract documents. The client can accept a bid and award the contract to the selected bidder, who then becomes the contractor for the work.
